23 Apr 8 considerations you may be forgetting in your consultant estimate

Estimating shouldn’t be scary if you do it right, but two common pitfalls make estimating an intimidating phase in the consultant journey. First, you may underbid (you snag the first deal but pepper the customer with change orders resulting in nothing more in the future). Second, you overbid, ensuring you don’t win very many deals. These pitfalls usually happen because someone along the line doesn’t spend the necessary time and effort to put together a realistic, on target estimation. Don’t fall into that trap! Put in the work now and avoid those fates entirely, increasing your chances of a longstanding customer relationship.

To make sure you estimate with accuracy, you have to consider all elements at play and that may affect the project. So, here are eight factors you need to consider for a solid estimate:

1. Documentation and communication time

It’s easy to forget the time and cost of documentation and meetings during a project. Many estimates don’t account for the time it takes to build a design or test doc, crucial parts to many projects. Additionally, delivering an estimate without accounting for meeting time or back and forth communication will also hurt you. Consider the expenses of agile meetings during a project and how that will affect the estimate.

2. Common gotchas

Technology transformation projects are multi-faceted, and they come with lots of little moving pieces and stages that aren’t always thought about at the beginning. Make sure your estimate has addressed the time and cost of these commonly forgotten elements:

Testing code in multiple browsers

Multiple mockups

Systems and sandbox environments

Project management

QA or UAT support

Testing

Training and change management to drive adoption

3. The project team

An estimate can vary largely depending on the people taking on the project. You have to ask yourself “How much time is this particular team going to take to accomplish the task at hand?” For example, a team that includes one person with 25 applicable certifications may work faster than a team with fewer certifications. A senior resource will naturally use less time to perform a task than a junior resource. Take a good look at the relevant skills, certifications, strengths, and weaknesses of the team coming on board to accurately estimate project time while considering the proper mix of resources.

4. Complexity

Be sure your estimate is being sized based on the complexity of the proposed project as well. Complexity can be calculated in many ways: by looking at how many decision-makers and stakeholders you’re working with, how big the existing work systems are, how much training is required, how big is the staff, how many mockups will be produced, how large is the end user base, how complex are the data sets, and how familiar is the client with the new tools being introduced. However you account for complexity in the estimate, make sure you’re considering the client’s technical perspective as well as your own.

5. Client’s deployment process

Every client has its own preferred process for deployment. Depending on how involved that is, this could affect the estimate. If a client has one sandbox, this won’t be a major area of concern. But if you’re dealing with four sandboxes, that quickly adds up and changes the estimate. If the client uses source control and code branches, this will lead to a longer approval and deployment process as well.

6. Risk multiplier

Including a risk multiplier in your estimate is a good way to acknowledge client responsibility and investment and show its effect on the estimate. The time spent chasing down decision-makers and client deliverables will rack up time and cost, changing the estimate. There may be areas that are hard to estimate upfront without time-consuming investigation, so acknowledge those along with the reasoning in your estimates. The risk multiplier is in place to mediate those changes and inform the client. So give the client a specific cost, because vagueness never does you any favors, but include the risk multiplier to cover the changes you can’t control on the client-side.

7. Transparency, assumptions, and constraints

This point can not be emphasized enough. Encourage transparency now and throughout the project. Things always happen. A good way to anticipate and alleviate the pains of those unforeseen situations is to be upfront about it. What are the assumptions from your side, what are the client assumptions, and what are the general constraints on the project? Recognize all of these factors and acknowledge the items that can’t be defined until later. Even if these items will affect your estimate, bringing them up early sets client expectations for time and cost variability down the line. Above all, share, share, and share again with the client.

8. The people performing the estimate

Lastly, make sure you put the right people in place to handle the estimate. A gas expert isn’t going to do well creating a technology project estimate. You need someone with proper knowledge and skills to match the client and the proposed project in order to create an accurate estimate.

Watching out for these eight commonly forgotten areas will elevate and protect your estimates. But what it all really comes down to is if you understand the scope and the client’s business, you’ll understand how to estimate. And remember that changes, potential risks, and unanticipated costs are all part of the process. If you’re straightforward and transparent about them with the client, you’ll be in great shape for smooth estimating.

Shane is the VP of Global Operations at Simplus. With his expertise in Professional Services, Operations, PMO, and Software Development and his experiences in partner, C-level, VP, and Director positions in a variety of industries, Shane thrives in operational excellence. He solves complex internal and client-facing problems with scalable solutions.